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                     A Closer Look at Internet Slot Joker123 Gambling in the UK
"there's a long way to go yet before we see online gaming licensed from the UK"
Upon publication of the government's response to The Budd Report the world news 
flooded with 'Las Vegas is coming to Blackpool' headlines. Behind that, the next 
biggest headline was that legalised online gaming was coming to the UK. Great 
news, on the surface of it; 'Britain will become a leader in online gaming' was the 
general consensus of opinion. But how true is that? Now that the dust has settled 
and the headlines have become fish and chip wrappers, it's time to look more 
closely at the government's proposals with regard to online gaming. Sadly, it may 
be the case that if the UK is to become the world leader in online gaming, it will not 
be for a number of years yet.
On March 26th the DCMS published its response ('A Safe bet for Success') to the 
Gambling Review body's report, known as 'The Budd Report'. Apart from a couple of
footnotes, it accepted all the recommendations made by Budd in relation to online 
gaming (recommendations 137 - 151). It accepted that online gaming should be 
permitted in the UK under the legislation of the proposed Gambling Commission, 
and that, as Budd had stated, it would be 'entirely unrealistic to prohibit'. In 
summary, the other points accepted covered testing and development of games 
and probity of operators to be under the auspices of the Slot Joker123 Gaming 
Commission, the protection of the vulnerable (underage and problem gamblers) 
through checks and self-limits, the identification of, and payment of winnings to, 
players, the issuing of a 'kitemark' to licensed operators and which sites could and 
could not advertise. Through accepting these recommendations the government 
feel that 'the UK could potentially catch a significant proportion of the online 
gambling market with specific legislation'.
The government accepted all the proposals put to it. Great, no more than the UK, 
and world, online industry could ask for. Granted it does give the UK the opportunity
to become a world leader and quite rightly it recognised the need to keep crime out,
protect the vulnerable and ensure fairness to players. The view from The States is 'a
rational approach from government - how novel. Perhaps our government might 
listen' So with all the good news, what is the problem?
The problem is a number of things. There was a complete lack of any detailed 
proposals. It is unclear what form any legislation might take. It is easy for a 
government to agree in principle, but it will be a different matter when it comes to 
writing law. The devil will be in the detail. The general view from the UK online 
gaming industry is 'We'll wait and see what actually happens but we can't wait'. 
However amongst other points that were raised in consultation stages, there are 
three points that need close attention. They are timing, tax and advertising.
When is this going to happen? Of course the land-based industry is also asking this 
but for the online sector this is much more pertinent. Firstly because there is 
currently no existing legislation, compared to the land-based industry which is 
awaiting amendment, not creation, of legislation. Secondly, as we all know, 
everything moves much, much quicker online than it does offline. Since Budd was 
published UK online gaming companies have been active; Rank have received a 
license in Isle of Man, Gala have indicated their plan to set up in Gibraltar, 
MSN.co.uk have launched a gaming channel, Victor Chandler have launched a bingo
site, Littlewoods and Ritz Clubs have received licenses in Alderney. And that is just 
the tip of the iceberg. There are many, many more moves afoot in the online sector 
of the UK industry. Major strategic moves like these have not happened in the UK 
land-based industry during that period. If as the DCMS say, legislation will not be 
brought before parliament until at least 2003-04 session, who knows what will 
happen in that time, and more importantly how relevant the legislation will be. 
Action has to be taken now.
A number of interim measures were included in the government's response that 
would not need to wait for primary legislation. Disappointingly, online gambling was
not included in these. As a suggestion, it should have set up an interim 'Online 
Regulatory Board' to deal solely with this area. This could then become a 
department of, or be rolled into, the Gambling Commission when it launches. But 
no, there was nothing. Not wishing to mix metaphors, the train has already left the 
station and we are going to miss the boat.
The only mention of the 'T' word (whisper it, "t-a-x") seemed to be on page 68 of the
appendix to the government's response which stated that 'Customs & Excise are 
addressing the implications'. As a general point, the complete aversion to 
mentioning tax by both Budd and the response from the government is surprising 
seeing as this whole review procedure is being driven by the potential for increases 
in UK tax revenue. As I write the next UK budget is less than a week away and do 
not be surprised if the topic of tax on the gaming industry does not get mentioned. 
Unlike the land-based industry, the online industry has a choice as to which tax 
regime to be based in. Therefore tax becomes an influencing factor in the situation 
of an operation and, more importantly, becomes a simple commercially-led 
decision. When considering how much to tax the potential UK online gaming 
industry, the government must remember the alternatives. Beneficial tax regimes 
for online gaming do not solely exist in little known islands in the Caribbean. 
Competition comes from legitimate licensing regimes in Gibraltar, Isle of Man and 
Alderney amongst others. If the government is considering, as rumoured, a uniform 
gambling tax, it must not include online gaming in it. Online gaming must have its 
own (low) tax laws. 'That's not fair' cry the objectors. When have 'tax' and 'fairness' 
ever been bedfellows? There is also the argument that online gambling and land-
based gambling are in fact different products anyway.
Proposal number 150 in the Budd Report stated that only those online gaming 
companies licensed in the UK would be able to advertise in the UK. In effect this 
recommendation is banning advertising from sites licensed anywhere else in the 
world. The site in question could well be a legal entity in it's host country, could 
have been subject to strict regulatory scrutiny and be offering something that's 
legal to participate in in the UK but it would not be able to advertise. Why? Tax - If 
you don't pay our tax you can't use our media. As this rule stands it also throws up 
the anomalies that major UK corporations like Ladbrokes, William Hill, Littlewoods, 
Stanley Leisure, Victor Chandler et al would be able to advertise online sports 
betting in the UK but not their online casinos. Neither would Sun online nor MGM, as
they are licensed in Isle of Man. Even more odd, major UK player Rank.com could 
advertise their new £1m bingo game (as it is a fixed odds game rather than a real 
bingo game and therefore legal) but not any multi-player bingo game that they may
launch from the Isle of Man. The rule is nonsensical and unworkable. It must go.
So in summary, what do we take out of this? Firstly, don't get over-excited, there's a
long way to go yet before we see online gaming licensed from the UK. When it does 
come in will it bring offshore operations onshore? Probably not. Will it bring in new 
operators who are looking for legitimacy, regulation, enforcement and security? 
Possibly. Those companies that already run offshore gaming sites should implement
the Budd recommendations regarding protecting the vulnerable now as a minimum.
Ideally they should also be looking at even more stringent ways to do so than 
recommended and be looking for additional safety and security measures.
However underlying all of this one must remember that the marketing and 
performance of a site will always be much, much more important than where it is 
licensed from.
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